If the agreement is intended to settle statutory employment claims, you must receive independent advice from a qualified adviser before it will be legally effective.

The law requires advice from an independent, insured, authorised adviser, and that adviser must sign a certificate confirming they have advised you on the agreement and its effect. In practice, this is almost always done by a solicitor. Solicitors regularly advise on settlement agreements, employers expect a solicitor’s certificate, and using a solicitor avoids delay or disputes about whether the agreement is valid.

Why is independent legal advice required?

Settlement agreements can prevent you from bringing valuable statutory claims, including unfair dismissal and discrimination. Parliament has therefore required employees to receive independent advice so that they understand what rights they are giving up, understand the financial and practical consequences of the agreement, and are not pressured into signing away rights without proper explanation. From the employer’s perspective, the advice requirement ensures the agreement brings the dispute to a clean and final end.

What happens if I sign a settlement agreement without a solicitor?

Employers will not complete the settlement or make payment unless they receive a properly signed adviser’s certificate. Even if you sign the agreement yourself, the employer may refuse to proceed until independent advice is confirmed.

If the statutory requirements are not met, the agreement may not validly waive statutory employment claims. This does not necessarily mean the entire agreement is void, but it does mean the employer may not achieve the certainty it expects. This is precisely why employers insist on independent legal advice before paying settlement sums.

For employees, signing without advice creates risk and uncertainty, rather than speeding matters up.

What does the solicitor actually do when reviewing a settlement agreement?

A settlement agreement review is not a rubber stamp. The solicitor’s role is to ensure you understand the agreement, that it reflects what has been offered, and that it does not expose you to avoidable risk. They will explain which legal claims you are giving up and which ones are actually relevant to your situation. They will review the financial terms, including how much you will be paid, when payment will be made, and whether any deductions apply.

They will check how different elements of the payment are described, such as notice pay, holiday pay, bonus or commission, redundancy pay, and any compensation paid as part of the settlement. Tax wording is particularly important. Some termination payments can benefit from favourable tax treatment, while others are always taxable as earnings. The way the agreement is drafted matters, and the solicitor will also check who bears the risk if HMRC later challenges the tax position.

The solicitor will confirm your leaving date, whether notice is worked or paid in lieu, and what happens to benefits such as pension contributions, private medical cover, or a company car. They will review any agreed reference to ensure it is attached to the agreement, is usable, and is consistent with what the employer is permitted to say internally and externally. Confidentiality and non-disparagement clauses are also explained so you understand what you can and cannot say, who you are allowed to speak to, and the consequences of breach.

If the agreement repeats or introduces post-termination restrictions, the solicitor will check whether you are agreeing to anything more restrictive than your existing contract and how this may affect future employment.

Legal fees and employer contributions

Most employers contribute to the cost of legal advice for a settlement agreement. This contribution often covers a standard review and the signing of the adviser’s certificate.

Your solicitor will confirm whether the contribution is sufficient, whether it covers VAT, and whether it is paid directly to them. If the agreement requires negotiation or is unusually complex, additional fees may apply, but these should be explained clearly at the outset.

When should I get legal advice?

You should speak to a solicitor as soon as you receive a draft settlement agreement. Early advice gives you the best opportunity to raise concerns or negotiate improvements and avoids rushed decisions close to a deadline.

Short deadlines are common, but they are often negotiable. A solicitor can help you ask for additional time where appropriate.

How long does a settlement agreement review take?

Many settlement agreements can be reviewed quickly, often within a few days, depending on complexity and availability. Agreements involving discrimination, whistleblowing, or complex pay arrangements may take longer, particularly if changes are needed.

The purpose of the process is to protect you efficiently, not to delay matters unnecessarily.

Can I negotiate the settlement agreement after legal review?

Yes. Settlement agreements are often presented as standard, but the terms are frequently negotiable. Legal advice helps identify where negotiation is realistic, whether on compensation, tax wording, references, confidentiality terms, benefits, or post-termination restrictions.

A solicitor will help you understand what leverage you may have and how to approach discussions in a way that protects your position.

Do I still need a solicitor if I am happy with the offer?

Yes. If the agreement is intended to settle statutory employment claims, independent legal advice is still required for it to be legally effective. Being content with the offer does not remove that requirement.

Where the offer is straightforward and acceptable, the advice process is usually quick and focused, allowing the agreement to be completed so payment can be made.

For more information, please contact us on 01524 907100, info@pre-law.co.uk or through ouur online enquiry form.